Philippines Nears Privatization of State-Operated Casinos with $1.5 Billion Sale
The Philippines has been considering selling its state-operated casinos for years. It's possible that these properties will soon change hands and be managed by commercial gaming operators.
The Philippines has both commercial and government-owned casinos. The latter operate under the Casino Filipino brand. The government has nine full-scale Casino Filipino venues and 34 satellite gaming locations. These satellites are often found in hotels or shopping centers.
The Philippines Amusement and Gaming Corporation (PAGCOR) oversees the Casino Filipino casinos and satellite branches. Beyond this, PAGCOR is responsible for regulating commercial casinos, including the four integrated resorts in Manila.
The gambling industry in the Philippines is doing well following the COVID-19 pandemic. Last year, the country's casinos brought in PHP184 billion (US$3.3 billion) in gross gaming revenue, which was nearly the same as in 2019.
With the Philippine government still struggling due to the pandemic, President Marcos believes privatizing PAGCOR's physical assets could help.
High Asking Price
PAGCOR Chair Alejandro Tengco has been in his position since August, taking over soon after Marcos replaced Duterte. Tengco revealed during the ASEAN Gaming Summit that the country is seriously considering selling its state-owned casinos.
"We are seriously considering privatization of all PAGCOR-operated casinos," Tengco said at the event held at the Manila Marriott Hotel. "It is my hope we will be able to implement privatization during my term."
Tengco's term goes until 2028, the same length as the presidency. He said the Philippines plans to raise around 80 billion pesos (US$1.47 billion) from the sale of these casinos.
The majority of the roughly $3.3 billion earned from casinos in the Philippines in 2022 came from licensed commercial casinos in Manila, Entertainment City, Fiesta, and Clark. Casino Filipino properties generated just $292.5 million.
Optimistic View
Some Southeast Asia-focused casino analysts think 2023 could be a particularly good year for Philippine gaming. With Macau no longer being the VIP haven it once was due to China's crackdown on junket groups, it's anticipated that these touring operators will shift their attention to other markets, including Manila.
Manila has three luxurious casino resorts in Entertainment City — Solaire, City of Dreams, and Okada. Resorts World is nearby in central Manila.
A flight from Hong Kong to Manila takes less than 2.5 hours. A flight from Shanghai to Manila is approximately 3 hours and 40 minutes.
China, suspecting that wealthy mainlanders have used Macau casinos to move large sums of money out of the Communist nation through a tax haven, has instructed Macau to reduce its reliance on casino gambling.
Abiding by the "one country, two systems" policy principles, Macau instructed its six gaming operators during their relicensing last year to invest heavily in non-gaming projects. The six casino licensees must put together at least $13.5 billion in non-gaming developments during the lifespan of their 10-year concessions that go through 2033.
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